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Saturday 23 August 2014

Watchdog criticises EU aid spending

Published 11/12/2012 | 00:44

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Hundreds of millions of pounds of UK taxpayers' money is being channelled into European Union aid projects without proper assurances that it is being spent effectively, an independent watchdog has found.

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Britain contributes around £1.4 billion a year to EU aid spending - accounting for 16% of the Department for International Development's (Dfid) aid budget.

However, the Independent Commission for Aid Impact (ICAI) - set up by the coalition to ensure the aid budget was delivering value for money - said Dfid had only limited oversight over the expenditure.

It strongly criticised the EU for weak management, slow decision-making and over-ambitious plans.

On its traffic light rating system it assessed Dfid's oversight as amber-red - meaning that it offered relatively poor value for money and that significant improvements were required.

"There is no effective performance management system in place for EU aid, which limits Dfid's oversight," the commission said.

"The EU's performance management and results framework are weak. As a result, Dfid is not getting the assurance it needs and that it achieves elsewhere, for example from the World Bank.

"Slow decision-making and processes hamper the delivery of results. Limitations to the EU's risk management approach, as well as over-ambitious project plans, are a significant obstacle to improving the performance of its programmes and projects."

The report is likely to heighten concerns among Tory MPs that the overseas aid budget continues to be protected at a time when other Government departments are facing real-terms cuts.

ICAI chief commissioner Graham Ward said: "Despite making good headway in influencing EU aid policy, Dfid needs to push the EU for a better account of where taxpayers' money is going and to engage further with EU projects and programmes at a country level to ensure that it is spent to the best effect."

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